Abstract
The coffee state of São Paulo launched a stockpiling programme to sustain world prices in 1906. Rothschilds publicly opposed the initiative but secretly participated in the transfer of funds to São Paulo in 1908, when a large harvest jeopardized the scheme. The end of the coffee programme would have deteriorated Brazil’s finances in the 1900s. That did not stop Brazil from borrowing in Paris that same year from banks that charged lower commission, suspending Rothschilds’ five-decades-long monopoly. Coffee prices fell in 1913, when the government pressured Rothschilds for a rescue loan. The bankers delayed the operation until the outbreak of the First World War. The conjunction of these adverse shocks—cheap coffee and the war—pushed Brazil to the edge of a default, which Rothschilds would not allow. Rothschilds launched the Second Funding Loan, which was similar to the homonymous operation of 1898 but did not include conditions on economic policy.
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Notes
- 1.
See Fig. 1.1.
- 2.
The Investor’s Review , 22 June 1901, vol. 16, p. 780.
- 3.
Calculated from The Investor’s Monthly Manual. See Chapter 4 for more on this emergent index .
- 4.
The risk premium of Brazil in the 1900s was below that paid by Argentina , Chile and Mexico in this order. Calculated from The Investor’s Monthly Manual.
- 5.
BHMF 332/226.
- 6.
Ibid., Empréstimo de 1911.
- 7.
BHMF 332/225, Empréstimo de 1908, section VI.
- 8.
Ibid., Empréstimo de 1911, section VI.
- 9.
See Table 1.1.
- 10.
RA Alfred Rothschild to Gustave Rothschild, 26 May 1908, XI/130A/219080526.
- 11.
RA Alfred Rothschild to Gustave Rothschild, 21 February 1910, XI/130A/4 19100221.
- 12.
RA Rothschilds to Minister Campista, 14 February 1907, XI/142/1905–1907. This point appears in Holloway (1975).
- 13.
RA Alfred Rothschild (London) to Gustave Rothschilds (Paris ), 7 August 1906, XI.130A/0/19060807.
- 14.
- 15.
ANB Afonso Pena to Rodrigues Alves, 23 September 1907, Coleção Afonso Pena, box 5, n. 11.48.
- 16.
Ibid.
- 17.
Ibid.
- 18.
RA I/000/77/5.
- 19.
RA I/000/77/5.
- 20.
RA Alfred Rothschild to Gustave Rothschild, 1 January 1907, XI/130A/19071001.
- 21.
RA Alfred Rothschild to Gustave Rothschild, 20 February 1907, XI/130A/1 19070220.
- 22.
See Dean (2002, 53–54) for more on the rubber boom.
- 23.
Balanço da Receita e Despeza da República, and IBGE (1990, 616–18).
- 24.
See Table 5.1.
- 25.
Calculated from The Investor’s Monthly Manual.
- 26.
RA Alfred Rothschild to Gustave Rothschild, 22 October 1912, XI/130A/6A.
- 27.
RA Rothschilds to Brazilian Minister Sales, 21 October 1912, XI/142.
- 28.
RA Alfred Rothschild to Gustave Rothschilds, 28 April 1913, XI/130A/6A.
- 29.
See Fig. 1.1.
- 30.
RA Rothschilds to Minister Sales, 6 May 1913, XI/65/13.
- 31.
The Economist , 10 May 1913, issue 3637, pp. 10, 11.
- 32.
RA Rothschilds to Minister Sales, 6 May 1913, XI/65/13.
- 33.
RA I/000/77/5.
- 34.
RA Rothschilds to Minister Corrêa, 28 July 1913, XI/65/13
- 35.
RA Alfred Rothschild to Gustave Rothschilds, 19 August 1913, XI/130A/6A
- 36.
RA Rothschilds to Minister Corrêa, 17 April 1914, XI/65/13.
- 37.
RA Alfred Rothschild to Gustave Rothschild, 19 December 1913, XI/130A/6A.
- 38.
RA Alfred Rothschild to Minister Corrêa, 23 December 1913, XI/65/13.
- 39.
RA Alfred Rothschild to Minister Corrêa, 17 February 1914, XI/65/13.
- 40.
RA Alfred Rothschild to Minister Corrêa, 17 April 1914, XI/65/13.
- 41.
RA Alfred Rothschild to Minister Corrêa, 24 March 1914, XI/65/13.
- 42.
RA Alfred Rothschild to Minister Corrêa, 23 February 1914, XI/65/13.
- 43.
RA Alfred Rothschild to Minister Corrêa, 17 March 1914, XI/65/13.
- 44.
RA Alfred Rothschild to Minister Corrêa, 23 February 1914, XI/65/13.
- 45.
RA London to Paris Rothschilds, 25 March 1914, XI/130A/6A.
- 46.
RA Rothschilds to Minister Corrêa, 27 April 1914, XI/65/13.
- 47.
Ibid.
- 48.
RA Minister Corrêa to Rothschilds, 7 July 1914, X/111/29.
- 49.
RA Rothschilds to Minister Corrêa, 27 July 1914, X/111/29.
- 50.
Calculated from BHMF 332/225, Bouças (1955, p. 254), and The Investor’s Monthly Manual.
- 51.
Calculated from IBGE (1990, p. 571) and The Investor’s Monthly Manual.
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Weller, L. (2018). Rothschilds and Coffee Finance: Brazil, 1898–1914. In: Sovereign Debt Crises and Negotiations in Brazil and Mexico, 1888-1914. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-73633-4_5
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